drinion wrote:MyNameIsFlynn! wrote:drinion wrote:MyNameIsFlynn! wrote:The government doesn't just replicate the private sector. There's a significant chunk of people who can't finance their education privately for lack of co-signer, credit, etc. Many types of USE.D. loans - at least in the amounts that would be needed to finance an education at a public school, community college, or junior college - only require the borrower to be a citizen and have a pulse.
And it's even worse for grad school. What private lender in their right mind would lend someone six figures to attend Cooley or (insert shit school here)? That's right - nobody would. So the government steps in to fulfill a perceived need and in doing so fucks over students by enabling them to graduate from shit schools with useless degrees. And thousands or hundreds of thousands in debt that will take years or decades to pay off, if they're even able to pay it off in full
The ABA should have better accreditation standards.
This is true but misses the point. Below-market interest rates distort the actual cost of education at all levels, not just professional.
As for discharging in bankruptcy, that gives the government an even larger role in the education loan industry. If they're discharge able, then what incentive do students have to pay them back? Kids could just rack up 200k undergrad debt (and another 100-300 in grad or professional if they want) and declare bankruptcy upon graduation. Voila, you've got you're degree(s) and no debt. Before you say "but who would fuck up their credit like this?" think about all the dipshits you know. There's plenty of people who would take this route. And this possibility would scare the shit out of private lenders, meaning more govt loans.
The federal loans only distort the "market price" of education. The government makes the loans because that "market price" would not allow most people to affordably educate themselves. Granted, this increase in demand for seats increases the price of the seats, but the loans weren't meant to lower the price. The petition is for the government to use the loans for their intended purpose, not to use them to fund other parts of its education budget.
Subsidized loans and below-market rates might not be "meant" to lower the cost of education but the reality is that they enable people to afford an education by lowering the price, specifically through lower borrowing costs, so your distinction is meaningless. The only way you make education more affordable is by lowering the price they pay, the only mechanism the federal government has to accomplish this outside the tax code is education loans (unless I'm missing out on something here?)
Of course the affordability argument relies on thr questionable assumption that every person should attain some form of higher education, which probably deserves its own thread.